During periods of economic instability, being prepared for any sudden contingency can help a business maintain its operations, reduce downtime and provide conditions for a swift return to normalcy. Implementing a crisis communication plan enables a company to address unexpected financial problems or threats to its reputation by establishing effective public relations channels and containing setbacks before they disrupt employee morale or customer confidence.

Many employers have enhanced their crisis communication strategies since the start of the economic downturn, hoping to alleviate recession-related fears among workers and project confidence to clients and shareholders.

A late-2008 survey from consulting firm Watson Wyatt found that 77 percent of employers had or were planning to send out internal communications to address the impact of the financial crisis. Sixty-nine percent of these claimed that reducing employee anxiety was one of their top two goals for crisis communication, while 32 percent cited earning employee trust.

Nearly two-thirds of employers said they plan to maintain regular crisis messaging as part of their communication strategy for an indefinite period. Staff meetings and face-to-face discussions were the most common methods for communicating, conducted by 87 percent of respondents, while 86 percent of employers also relied on e-mail.

"Communication can be a powerful tool in these troubled times, especially when supported by different levels of management. But it's important to keep the specific business context in mind and constantly monitor the effectiveness of the messaging," Kathryn Yates, global director of communication consulting at Watson Wyatt, said in an announcement of the findings.

According to the Institute for Public Relations (IPR), a crisis can come in the form of three often-related types of threat: public safety risks, financial losses and damage to a reputation. Financial losses can accrue from disrupted operations, which may result in declining market share, a drop in purchases or lawsuits that put strain on a company's budget. These disruptions can lead to or be caused by damaged reputations, while public safety risks, such as harmful products or production accidents, are related to both.

The IPR breaks down crisis management into three stages: "The pre-crisis phase is concerned with prevention and preparation. The crisis response phase is when management must actually respond to a crisis. The post-crisis phase looks for ways to better prepare for the next crisis and fulfills commitments made during the crisis phase including follow-up information."

The most critical component in an effective crisis management system is having a pre-crisis plan that can be implemented as soon as possible after an emergency strikes. While there is no single approach capable of addressing every problem, nor one that can be applied to every type of organization, a few common strategies may be used as a foundation for a crisis communication plan.

The Department of Homeland Security's Ready Business, an initiative for helping small and medium-sized businesses with emergency planning, recommends that companies target the following areas:

• Employees — Be prepared to explain to employees how their jobs may be affected by a crisis and when, if and how to perform work following an emergency. This can be accomplished through an e-mail alert, a password-protected page on the company Web site, phone calls or in-person meetings.
• Management — Provide the company's executives with all the pertinent information they need to protect the interests of employees, customers, vendors and facilities.
• Public — The general public may need to be informed about how the organization is using its resources to address the crisis, what it will mean for the community and what sort of recovery efforts they can expect to see.
• Customers — Reassure your customers and clients about how and when products will be received and services rendered to avoid damaging relationships.
• Government — It may sometimes be necessary to contact the local, state or federal government to explain what sort of assistance might be needed to continue essential business activities.
• Other Companies — In certain cases, businesses may need to contact other firms to inform them about a potential crisis so they can assess their own threat levels.

"[K]eep in mind that this crisis may allow you to continue business as normal, or it may result in a situation where you aren't able to get access to the tools you normally use to do your job (natural disaster, lockout, etc.) so your crisis communications kit needs to provide the capability for you to provide the appearance of normality even in the most abnormal situations," Global PR Blog Week advises.

By incorporating crisis communication planning and management strategies into the general level of risk preparedness, companies can help ensure that financial, reputational or safety threats serve only as temporary interruptions.

Resources

Most Companies Step up Communication to Ease Workers' Recession-Related Stress
Watson Wyatt Worldwide, Dec. 19, 2008

Crisis Management and Communication
by W. Timothy Coombs
Institute for Public Relations, Oct. 30, 2007

Write a Crisis Communication Plan
Ready Business

7 Must-Have Elements in Every Crisis Communications Kit
by Don Crowther
Global PR Blog Week, July 15, 2004