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Coaches Corner

Breaking Bad News in Troubled Times

by Peter Whalen

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How and when do you talk about bad news?  That’s a question that a lot of CEOs and business owners are thinking about.  This recession’s impact on sales, profits, and financial stability can range from a little belt-tightening all the way to looking at bankruptcy.  The more severe the problem, the sharper the instinct to not let anyone know about it.  Unfortunately, that instinct is usually wrong.  The most severe problems require the greatest attention to communications.

Let’s look at one bad news scenario as an example of how to approach communications strategy: Your company can no longer meet debt obligations, and will have to either renegotiate or restructure.  We’re not going to offer advice about when to talk to lenders, but we will give some guidance about when to go public with bad news.  

Why can’t you just keep it quiet?  It’s nice if you can, but usually there is no sense in trying to duck the issue, or hoping that it won’t come to talking about it publicly.  The whole world knows what the recession is doing to companies like yours. Companies in your industry likely have similar problems and some won’t make it.

The most sensible course of action, then, is to have plans in place now to deal with the coming storm.  Financial plans, of course, but also communication plans.

Bad news about your company is going to be communicated through the news media.  Too much bad news will have a negative impact your ability to keep doing business.  Rather than hold your breath and merely respond when the media questions come, you can take control and prepare your communication plans now to deal with the crisis in the most effective manner. 

In a situation this bad, a goal of completely avoiding negative news is unrealistic; your goal has got to be preserving your company’s reputation.  A good crisis PR program is not going to make all your problems go away, but it can minimize the impact of negative publicity on your company’s reputation and maybe even contribute to its survival. Even in bad times, a reputation can be saved by how well the company deals with adversity.

Each situation is unique, but elements of this type of program generally include proper messaging, selecting and preparing the right spokesperson, developing a media relations strategy that most benefits the company, putting rapid response procedures in place, and taking the position that ducking and covering won’t help you, but rather that your point of view should be included in media coverage.

When something material is happening with the company, such as defaulting on a loan, it may be time to get out in front of it by talking about the bad news.  Proactive communication on the bad news does at least two good things:  It gives you more control over the timing, and it gives you the opportunity to frame the story in the best possible way.  Let’s be clear, there is no making a silk purse from a sow’s ear, bad news is bad news.  But bad news also can be put in context:  We’re in a recession, markets have plummeted, everyone has troubles, so do we, and here’s what we’re doing about it.

If you don’t have a public relations firm on board, get one.  You are going to want experienced professionals to help you with this one.

Thorp & Company is a leading public relations firm based in Coral Gables, Fla. with extensive experience in crisis communication. Peter Whalen serves as chief strategist for Thorp & Company. He has provided public relations counsel to some of America’s leading corporations, including General Motors, The Dow Chemical Company and Owens Corning. His role with Thorp & Company is to provide clients with hands-on, senior level public relations counsel and service develop unique solutions to issues each client may face and ensure consistently high levels of value and client satisfaction. He also helps clients with crisis communications, marketing of products and services and media spokesperson training.  For more information, please contact Thorp & Company at (305) 446-2700 or visit

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